Trading the Line

Blue Pill or Red Pill

One week before the expiration of the large Red T structure formed at the 'Brexit' panic low the market appears to have 'stopped' and is effectively treading water waiting for some kind of catalyst.

Should we take the blue pill or the red pill – will the market Buy its way out of this stalemate or Sell off ?

What I believe is happening is that the downward force of the ending of the really long-range T structures – marked in pink and purple – are being counteracted by the upward force of the Red T structure.

The Red T structure is significant because it starts from an extreme high in the oscillator and is centred on an extreme low, similar to the main arm of the pink T structure.

As we can see the recent low formed a small T but the oscillator has failed (so far) to make any headway and the market has muddled along sideways. The downward sloping 'cash-build up' line marked in green remains unbroken and waiting to be used in the next T structure.

So what happens next? We 'should' see a push upwards into the final days of the Red T structure, followed by a distinct lack of buying power afterwards, ideally accompanied with some heavy selling and a low in the oscillator to form a new T structure, and hopefully a rally into Christmas after the Election is resolved.

Be prepared.

Steve Rushton October 9, 2016No Comments

S&P500 daily update

Wonderland

This is your last chance. After this, there is no turning back. You take the blue pill—the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill—you stay in Wonderland, and I show you how deep the rabbit hole goes. Remember: all I'm offering is the truth. Nothing more.

– The Matrix, Dir: The Wachowskis, 1999

Market still undecided, and not sure which pill to take.

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Disclaimer: This is the diary of a personal trading system, its methodology and the signals that it is producing. You are welcome to follow along but please understand that the information presented here is for educational & entertainment purposes only. No recommendations are being made to buy, or sell stocks, options or futures contracts. Please consult your own financial advisor before making any investment decisions.

Steve Rushton October 8, 2016No Comments

S&P500 daily update

When the music’s over, turn out the lights

Come back, baby
Back into my arm
We're gettin' tired of hangin' around
Waitin' around with our heads to the ground

I hear a very gentle sound
Very near yet very far
Very soft, yeah, very clear
Come today, come today

– Jim Morrison, The Doors, 1967

This morning I found myself humming 'When the music's over, turn out the lights…'

I'm starting to see this recent action (since mid July) as a large diamond or lozenge shape, a waiting game if you will.
The End of this tiresome movement (presumably of exhaustion) should therefore coincide with the expiration of the red T structure.

From a technical perspective, the market is right on the line…

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Steve Rushton October 7, 2016No Comments

S&P500 daily update

More chop shop

Choose your side of the fence and defend as appropriate. Grab a few points here and there.
Very close to a Buy signal yesterday but stayed short due to the tight triangulation and presence of a cycle high yesterday.

Still on a *Short Alert* and would require exit above the triangle to overide that.
Put / Call ratios signalling complacency associated with tops in markets.
Bollinger bands descending and tightening due to negatively shaped triangulation.

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Steve Rushton October 6, 2016No Comments

S&P500 daily update

Chop shop

On a Sell Signal since yesterday afternoon's drop below 2154, but need to see some follow through as maybe the market will continue its seesaw chop up and down. As I have mentioned before, there are some strong (perhaps dark) forces at play keeping this market up.

Hopefully the end of the red T structure (Oct 17 or thereabouts) will provide some resolution to this malaise.

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Steve Rushton October 5, 2016No Comments

S&P500 daily update S&P500 signal

S/T Sell Signal at 2151

A Short Signal from 2151 occurring with the market dropping out of the recent triangle, and looking like its right on time with a cycle high scheduled for tomorrow, and the recent expiration of major arm of the red T structure.

Maybe targetting support lines at 2130 or 2120.

More tomorrow.

Steve Rushton October 4, 2016No Comments

S&P500 daily update

Maybe (a) stick up

Maybe stuck, or maybe a stick up.

Since mid June the market has essentially gone nowhere, in a series of flatlines separated by skids, or jolts, perhaps seizures..

is the patient still alive ?

and this triangle is running out of space,

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Steve Rushton October 3, 2016No Comments

S&P500 signal

Triangle time

Triangle in play and hit expected resistance at 2172-5 with profit-taking.

Recovery of the T volume oscillator suggesting that there is the possibility of short-term strength into the early part of the week with another short-term high scheduled for October 4-5.

Choppy day-traders market likely to continue until direction resolved.

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Steve Rushton October 1, 2016No Comments

S&P500 daily update S&P500 intraday update S&P500 signal

S/T Buy Signal at 2163

Erratic market signals trouble ahead, but covered and back on a Buy Signal at 2163, expect short-term.

The erratic nature of the signalling is also 'telling' us something – and we should expect it to continue for the next few weeks. The market does not want to go down, there are significant forces at play keeping it up, but when the buying power dries up – albeit temporarily – as to be expected at the end of a major T structure, then the market will drop hard until the buyers are found at lower prices.

I think we are being warned that something unpleasant is about to occur.

Be prepared.

Steve Rushton September 30, 2016No Comments

S&P500 daily update S&P500 signal

S/T Sell Signal at 2153

Short lived Buy signal again, market selling into rallies – covered and short from 2153.

An ugly triangle starting to appear indicative of a larger squeeze probable and as we are approaching the end-game of the large Red T structure it would make sense to expect the larger move to be 'down'. (perhaps after a short-lived pop to the upside.)

I think we are being warned that something unpleasant is about to occur.

Be prepared.

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Steve Rushton September 29, 2016No Comments

“Simplicity is the ultimate sophistication.”
Leonardo da Vinci

“Imagination is more important than knowledge”
Albert Einstein

“All of our days are numbered. We can not afford to be idle. To act on a bad idea is better than to not act at all because the worth of the idea never becomes apparent until you do it. Sometimes this idea can be the smallest thing in the world; a little flame that you hunch over and cup with your hand and pray will not be extinguished by all the storm that howls about it. If you can hold on to that flame, great things can be constructed around it; things that are massive and powerful and world changing. All held up by the tiniest of ideas.”
Nick Cave, 20,000 days on Earth

2026 Positions

(All numbers refer to SPX)

S/T SELL Signal at 6756 on 11 Mar

S/T BUY Signal above 6826 on 10 Mar

COVER Short Signal above 6792 on 10 Mar

S/T SELL Signal at 6765 on 10 Mar

COVER Short Signal above 6772 on 09 Mar

S/T SELL Signal below 6810 on 06 Mar

COVER Short Signal above 6822 on 05 Mar

S/T SELL Signal below 6822 on 05 Mar

COVER Signal below 6849 on 05 Mar

S/T BUY Signal at 6882 on 04 Mar

COVER Short Signal above 6849 on 04 Mar

S/T SELL Signal below 6845 on 03 Mar

COVER Short Signal above 6877 on 02 Mar

S/T SELL Signal below 6850 on 02 Mar

COVER Short Signal above 6857 on 27 Feb

S/T SELL Signal at 6857 on 27 Feb

COVER Signal below 6884 at 6857 on 27 Feb

S/T BUY Signal at 6884 on 23 Feb

COVER Short Signal at 6850 on 23 Feb

S/T SELL Signal at 6837 on 23 Feb

COVER Signal at 6864 on 23 Feb

S/T BUY Signal at 6883 on 18 Feb

COVER Short Signal at 6834 on 17 Feb

S/T SELL Signal at 6888 on 12 Feb

COVER Signal at 6915 on 12 Feb

S/T BUY Signal at 6899 on 06 Feb

COVER Short Signal at 6938 on 06 Feb

S/T SELL Signal at 6901 on 04 Feb

COVER Short Signal at 6915 on 03 Feb

S/T SELL Signal at 6915 on 03 Feb

COVER Signal at 6942 on 03 Feb

S/T BUY Signal at 6968 on 02 Feb

COVER Short Signal at 6938 on 30 Jan

S/T SELL Signal at 6910 on 30 Jan

COVER Signal at 6940 on 30 Jan

S/T BUY Signal at 6934 on 29 Jan

S/T SELL Signal at 6907 on 29 Jan

COVER Signal at 6934 on 29 Jan

S/T BUY Signal above 6905 at 6923 on 22 Jan

COVER Signal at 6849 on 21 Jan

S/T SELL Signal below 6894 at 6843 on 20 Jan

COVER Signal below 6925 at 6843 on 20 Jan

S/T BUY Signal at 6961 on 15 Jan

COVER Signal below 6934 at 6925 on 14 Jan

S/T BUY Signal above 6890 at 6900 on 05 Jan

COVER Short Signal at 6864 on 02 Jan

S/T SELL Signal at 6837 on 02 Jan

Mission

It has been my Mission to create a simple but effective method for investing in the stock market, so that I would always know what to do regardless of the circumstances.

The result is a rigorous system which allows the market to tell you what to do, when to Buy, when to Hold, when to Cover, and when to Sell, and it removes the need for you to have any opinion whatsoever.

And so, I present to you the diary of my personal trading system, and a record of the signals that it is producing. You are welcome to follow me along but please understand that the information posted here is for entertainment purposes only. No recommendations are being made to buy, or sell stocks, options or futures contracts. Please consult your own financial advisor before making any investment decisions.

Please sign up for my occasional FREE REPORTS and if you would like to find out more and receive my email alerts and more detailed observations, please SIGN UP HERE

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“In the end, I’m not interested in that which I fully understand. The words I have written over the years are just a veneer. There are truths that lie beneath the surface of the words... truths that rise up without warning, like the humps of a sea monster and then disappear. What performance and song is to me is finding a way to tempt the monster to the surface, to create a space, where the creature can break through what is real and what is known to us. This shimmering space where imagination and reality intersect... this is where all love and tears and joy exist. This is the place. This is where we live.”
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“If you're going to try, go all the way. Otherwise, don't even start. This could mean losing girlfriends, wives, relatives and maybe even your mind. It could mean not eating for three or four days. It could mean freezing on a park bench. It could mean jail. It could mean derision. It could mean mockery--isolation. Isolation is the gift. All the others are a test of your endurance, of how much you really want to do it. And, you'll do it, despite rejection and the worst odds. And it will be better than anything else you can imagine. If you're going to try, go all the way. There is no other feeling like that. You will be alone with the gods, and the nights will flame with fire. You will ride life straight to perfect laughter. It's the only good fight there is.”
Charles Bukowski, Factotum, 1975

>“The mind is a glass floor.
The mind is the spirit’s tear.
The mind is our prior and subsequent ghost.
The mind is the Bullion Express and the blood on the tracks.
The mind is a stone door.
The silver on the backs of mirrors.
The wave that defines the coast.
It’s what the drunk grave robbers couldn’t stuff in their sacks.
The mind is the sum of all and more.
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The parking lot at the Mall of Fears.
The fire-pit for the piggy roast.
What the soul surrendered and won’t take back.
The mind is neither either nor or.
The real center of an empty sphere.”
Jim Dodge, Stone Junction, 1990

“The war is not meant to be won, it is meant to be continuous. Hierarchical society is only possible on the basis of poverty and ignorance. This new version is the past and no different past can ever have existed. In principle the war effort is always planned to keep society on the brink of starvation. The war is waged by the ruling group against its own subjects and its object is not the victory over either Eurasia or East Asia, but to keep the very structure of society intact.”
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